RUSSIA would regard any US move to curb the operations of Russian banks or their foreign currency dealings as a declaration of “economic war”, Prime Minister Dmitry Medvedev said on Friday.

Mr Medvedev issued a thinly-veiled threat, suggesting his country was prepared to act “by other means” if economic or political measures failed to get results.

The United States announced a new round of sanctions targeting Russia on Wednesday that pushed the rouble to two-year lows and sparked a wider sell-off over fears Russia was locked in a spiral of never-ending sanctions.

Separate legislation introduced last week in draft form by Republican and Democratic senators proposes curbs on the operations of several state-owned Russian banks in the United States and restrictions on their use of the dollar.

Speaking during a trip to Russia’s far east, Mr Medvedev said: "I would not like to comment on talks about future sanctions, but I can say one thing: If some ban on banks' operations or on their use of one or another currency follows, it would be possible to clearly call it a declaration of economic war.

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It would be necessary to react to this war economically, politically or, if needed, by other means

Russian Prime Minister Dmitry Medvedev

"And it would be necessary, it would be needed to react to this war economically, politically or, if needed, by other means.

“And our American friends need to understand this.”

The legislation Mr Medvedev was referring to is far from certain to be passed by US Congress, which is not due to reconvene until September.

Wednesday’s surprise US State Department announcement of fresh sanctions are linked to the widely held belief in Washington that Russian agents were responsible for the nerve gas attack on former spy Sergei Skripal and his daughter Yulia in Salisbury.

Dmitry Medvedev has warned attempts to curb Russian banks will be seen as an act of 'economic war' (Image: GETTY)

The measures will come in two phases. The first, which targets US exports of sensitive national-security related goods, comes with exemptions, while many of the items it covers have already been banned by previous restrictions.

The second, which can be selectively activated after 90 days if Moscow fails to provide "reliable assurances" it will no longer use chemical weapons and blocks on-site inspections, could include downgrading diplomatic relations, suspending national flag carrier Aeroflot's ability to fly to the United States and cutting off nearly all exports and imports.

They come despite US President Donald Trump’s much-publicised summit with Russian opposite number Vladimir Putin last month.

The US response may be partly motivated by a desire to be seen to be tough on Moscow after accusations that Mr Trump was too soft on Russia.

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US President Donald Trump with Russian opposite number Vladimir Putin at last month's summit (Image: GETTY)

The US sanctions are in response to Russian links to the poisoning of Sergei and Yulia Skripal (Image: GETTY)

The Kremlin responded by describing the sanctions as illegal and unfriendly and adding that the US move was at odds with the "constructive atmosphere" of Mr Trump and Mr Putin's meeting in Helsinki last month.

Moscow would start to work on retaliatory measures "in the same spirit" as any US restrictions, Russia’s Foreign Ministry said.

The State Department's announcement fuelled already worsening investor sentiment about the possible impact of more sanctions on Russian assets and the rouble at one point slid by over 1 percent against the dollar, hitting a two-year low, before recouping some of its losses.

Nevertheless, the currency took a battering on the money markets, sliding to its lowest level since late 2016 on Thursday, hitting 66.7099 roubles to the dollar.

The Russian rouble took a battering on the currency markets yesterday (Image: GETTY)

At 12.21am GMT yesterday, it was changing hands at 66.5245 to the dollar.

The US move also triggered a sell-off in Russian government bonds and the dollar-denominated RTS index fell to its lowest since April 11.

BCS Brokerage said: ”There is local panic on the currency market.

"At times, the number of those who want to ditch the rouble is becoming so high so there is not enough liquidity."